AUG 25, 2014 Oh, I’m sorry, those are crazy small cats in the picture, but have you seen some of the CRAZY SMALL CAPS? Rather explosive moves have been occurring in many small caps like LEJU, JRJC, HGSH, DGLY, KNDI, MOBI, DANG, after experiencing rather steep sell offs. As mentioned in my last report, I have been very busy this August, so while I did catch a couple of these baby rocket-ships early on due to their “Set ups” (Leju & JRJC) …I also have been forced to sell way too soon. JRJC was sold at $8 for example, and They are still running nicely. They have left me behind after I sold them. The point that I am making here, however, is that certain ‘set ups’ after a steep sell off can indicate a possible explosive move is coming and those were just a few examples. IF THERE ARE MORE currently setting up that have not exploded upwards yet…there may be opportunity for more Low Risk Entries prior to a nice POP (I cant re-enter the above mentioned unless they pullback).
First lets review a few things in various Markets…
When the markets sell off, you hear all kinds of warnings, but it has been buying opportunities as the selling became overdone.
In my last report I mentioned a few possibilities and I used this chart to point out that “If the selling was done, these markets could be setting up in a parabolic way”
I was actually thinking that we could get more selling and the markets would still be healthy, but we did get a reversal and the Buyers stepped in. At that time, I used this chart to show that despite all the BAD SCARY NEWS – These markets were climbing a wall of worry
I noticed that small caps were selling off and lagging the SPX, so I mentioned that IWM possibly was a double top. NOW, however, with recent Small caps and micro caps surging back lately…there is a possibility that they were just “CONSOLIDATING” their recent gains. THAT could possibly lead to a break out to new highs too (But we have to wait & see - for now short term trading is paying off just fine). These are charts of the possible consolidation .
And notice how the weekly chart of IWM has a consolidation very similar to the one in 2012. HHMMM, maybe Yellins speech has allowed more time for these markets to rejoice?
QUICKLY…Before we move to some individual stock chart ideas, I want to say that I do not like what I see in Precious metals at this point.
Gold lost the 50sma and even though I expect a bounce in GOLD, notice the 50sma. Likely GOLD will not get above that. (Note: These were drawn AUG 21…I tried to write a report and ran out of time)
Aug 15, which was a week ago Friday , I was watching GLD and it looked weak. I drew this last Monday pointing out a volume by price support. It has since given way and that was not good.
GDX - Also not great, looks like a double top (though some individual Miners still have healthy looking charts, they will likely give it up if Gold drops to test lows again).
NOW…WHAT ABOUT THOSE CRAZY SMALL CAPS?? I will still be “in & out” this week, so I want to just give you a LOT to look at & track while I’m away.
WARNING- Yes, Many are POPPING, and I look for MANY things in a ‘proper set up’ . Remember that some are still DROPPING. Low Risk Entry is important and honoring stops is even more important. I look at companies and do Due Diligence first!! Things like checking if they have earnings release yet? or soon? (Personally I AVOID IF EARNINGS ARE COMING OUT TOO SOON). So there is risk & there has been great reward…Trade AT YOUR OWN RISK LEVEL.
This is JRJC that I spoke of earlier. It is ridiculously beautiful. The buy was a triangle break, I sold that day near $8, very overbought I.M.O. . IT KEPT GOING!.
JRJC at the end of the week! WOW!!
I mentioned HGSH. Here it is as another example of what I am discussing… $2 to $7 in 3 weeks.
So there is the explosive side. Again you can look at LEJU, KNDI, MOBI etc for more examples…but for the sake of time I just want to throw up a few charts on my watch list. I will try to point out why I like them, but if you know chart patterns, you can see some reasons on your own. Make a list for yourself and keep track of them, as they start to break out…if earnings are behind them, etc yu may make some great trades.
NQ is not a perfect set up on a weekly, but I like the daily so I will show both charts (and the earnings report is already out ). I am watching this
If you’ve been watching COFFEE, and JO ETF…here is a stock that I have traded in the past and done very well with …JVA.
This is the weekly and it has plenty of upside.
JVA DAILY is breaking upward. Could take off, could pullback, but it is above the 50sma now & looks bullish.
ADEP – Earnings after the bell today (So you should Wait) – Does someone know something though ?? OR just jumping the gun?
CCCR (China ) Caught my eye
I REALLY LIKE VJET SO FAR above the Blue line is first buy…Break of the Orange Line is another I.M.O. This is the daily
AT — I rode this up for months this spring and eventually sold to free up money (It was a slow mover) , but I think it has strong potential on this weekly chart , and an easy entry (50 sma for ex) on the daily chart.
CGA broke out
GV Earnings came out & they have record back log…Daily volume buying starting increasing . Could be due for a pullback, will that be a buy??
GV WEEKLY H&S? or Ready to break upside? Kind of looks very interesting to me.
RALY - EARNINGS THIS THURSDAY AUG 28. Last earnings report SMOKED this stock. HUGE gap down. This could be a nice set up here though, why??
It could break out from this descending wedge on the weekly chart if earnings improve , or it could drop to the bottom and capitulation lows could come in if they miss. The high volume lows on the daily could get back tested and thats it…all sellers out?? I think it bears watching anyways, look for divergence if it sells off.
Thats it for now (There are actually quite a few more, but my time is up). Why not start a watch list of ideas or even easier than that…as the week goes by, keep looking back at this report & see how these are playing out. Use this report as a before & After. Some will win, some may lose….but There have been some GREAT % GAINERS and even while busy with other things during my past few weeks in Aug, I have been able to take a low risk position & watch it on my phone from time to time or at lunch. Some of these CRAZY SMALL CAPS are becoming little rockets !
Thanks for reading!! Best to all and lets raise the roof on some of these small caps!!